A News 8 investigation reveals thousands of aircraft mechanics may have been improperly licensed in Texas since the early 1990s.

They have been scattered throughout the state and the country.

They may even have worked on the airplanes on which you or your family have flown.

The FAA issues the certificates that permit mechanics to fix the airplanes Texans fly on.

But we’ve learned that some of those licenses have been for sale.

“My opinion is that the FAA and the Southwest region is corrupt.”

These are the words of Gene Bland, a former FAA inspector.

His harsh judgment of his former employer comes in part from a case he worked on in San Antonio 16 years ago.

Examiners, approved by the FAA, were selling certificates to mechanics.

“Those people know that the FAA is not waiting there to catch them,” he said.

Some 250 mechanics had to be re-tested by the FAA, because the FAA-deputized examiners were cheating, giving mechanics the license to repair planes, when they weren’t necessarily qualified to do the job. That was in 1993.

Now a building at the San Antonio airport is the focus of a similar scandal.

It was home to Tobias Aerospace, where 1,300 mechanics have been tested – mechanics who work on aircraft flying in Texas.

What may have happened here is what some experts call a “shake and bake” school – where improperly-certified mechanics got certificates to do business.

The testing facility was headed by Brian Tobias, an approved Designated Mechanic Examiner, known as a DME. DMEs administer a two-part test to mechanics, for what’s known as an A&P certificate.

The first part – called the written test – is given on a computer.

The second is a grueling oral and practical exam between one examiner and one mechanic. The test can take as long as ten hours – the mechanic pays the examiner, usually $600 to take it. In theory, the more tests an examiner gives, the more money he makes.

Hundreds of mechanics appear to have been tested correctly. But for the last eight months, FAA investigators have been probing the operation.

“They have told me the charges against Mr. Tobias involves several governmental organizations, including the VA, for defrauding because VA paid for my A&P license,” an anonymous source said.

The ramifications spread far beyond Texas, all the way to Boeing in Seattle, because Tobias tested mechanics from all over the world, including dozens from Boeing, who could command higher wages, once they passed the test. Now the FAA is holding all those legitimate candidates in limbo.

“They have kinda been stonewalling me,” said a source.

“I think it is a horrible situation as far as many mechanics are being affected by it. We’re looking at thousands of mechanics having their A&P revoked or never issued and not being issued,” a source said.

Documents, e-mails and interviews indicate that at some point, Tobias Aerospace may have turned into a “shake and bake” operation.

The facility allegedly gave tests to applicants from foreign countries, in Spanish, through a translator, a direct violation of FAA rules.

“She was reading the questions in Spanish and translating it A,B, C,” a source said.

“There would be a van full of guys from South America. And these guys would go on in and start testing. They did not speak English,” another source said.

The FAA declined an on camera interview. The agency denies tests were given in Spanish.

But these mechanics, like many we talked to for this story, asked that we keep their identity secret.

That’s because the FAA has a history of punishing critics. Gene Bland was one.

“The people that have been whistleblowers in the FAA have paid dearly,” he said.

Tobias Aerospace was shut down by the FAA last year. Its rooms are empty now.

We called Bryan Tobias and he did not respond.

Then we stopped to see him.

We asked him how many people he tested last year. Was that figure 700?

“It wasn’t that many. You’ll have to leave my property,” he said.

One unanswered question is how much the FAA knew about the Tobias operation.

Mechanics must visit the FAA office before they’re even allowed to take an exam. They must be interviewed as part of Form 8610.

Those who couldn’t speak English, as required, should not have been allowed to take the test.

This all leads to questions of corruption.

Have FAA individuals been getting kickbacks?

“Yes, some of them have. They had to have because you can’t inspect these people. It could not have gone through the FAA office,” a source said.

A year ago the FAA was the subject of a congressional investigation for the way it inspected airliners.

On Monday, Senator Grassley (R-IA) expressed his support for the Fraud Enforcement and Recovery Act of 2009 (S. 386) saying “we simply cannot allow unscrupulous individuals to defraud the government and rip off taxpayers.” The bill provides new tools for the federal government to fight fraud and makes much needed amendments to the Federal False Claims Act.

Under the False Claims Act, whistleblowers bring lawsuits against companies who defraud the federal government. As a reward for their courageous actions, whistleblower receive a portion of the amount the federal government recovers. As Senator Grassley correctly pointed out in his floor statement, “we would not have the case or the money returned if it wasn’t for the information of the whistleblower.” This law has been used to recover more than $22 billion since 1986 and has deterred an incalculable amount of fraud.

The amendments to the False Claims Act correct loopholes created by recent court decisions, including the Allison Engine case, which allow companies to avoid liability for fraud. These amendments are absolutely necessary to protect taxpayer dollars – especially in light of the billions of dollars spent in the economic stimulus and TARP legislation. However, Senator Grassley reminds us “you’re going to find those same special interests that have been around for the last 20 years, trying to gut the legislation. Why? Because it’s one of the most effective tools against fraud.” We will be following this legislation and will keep you updated on its progress.

In addition to the amendments to the False Claims Act, the bill authorizes funding for law enforcement and prosecutors, makes changes to federal criminal laws, redefines “financial institution” to include mortgage lending businesses, and adds commodities futures to the securities fraud statute. The bill also makes it illegal to make false statements on mortgage applications and appraisals and ensures that economic relief funds and TARP funds are included in criminal law prohibiting fraud against the government.

The Office of Management and Budget issued a Statement of Administration Policy to the Senate on Monday, April 20th stating that the Obama Administration “strongly supports enactment of S. 386.” The statement explained that the Fraud Enforcement and Recovery Act of 2009 (S. 386) would “benefit U.S. taxpayers by both addressing existing fraud and deterring waste, fraud, and abuse of public funds.” It also pointed out that the bill would “amend the False Claims Act (FCA) in several important respects so that the FCA remains a potent and useful weapon against the misuse of taxpayer funds.”

Notably, the statement supporting the Fraud Enforcement and Recovery Act is the only statement the Office of Management and Budget has sent to the Senate since the beginning of the Obama Administration.

Earlier today the Senate rejected an amendment to the Fraud Enforcement and Recovery Act (S.386), which would limit the amount a whistleblower can receive from recoveries under the False Claims Act. Currently judges can award whistleblowers up to 30 percent of the total recovery for the government. The amendment would have limited the whistleblower reward to $50 million. Senate Judiciary Chairman Patrick Leahy opposed the amendment noting that the False Claims Act is “very well balanced the way it is, with a judge having to make a final decision on the award.”

Now the Senate is voting on the remaining amendments to the anti-fraud legislation, which could pass as early as this afternoon. We will keep you up to date on the latest developments.

The members of the NISPPAC are representatives of those departments and agencies most affected by the National Industrial Security Program and non-government representatives of contractors, licensees, or grantees involved with classified contracts, licenses, or grants, as determined by the Chair. The Chair appoints the members of NISPPAC. The ISOO Director chairs the NISPPAC. The members include 16 representatives from Executive branch agencies and eight representatives from industry.

This is another area of huge concern.Those who would lobby from both within the government and also within industry will stop at nothing to gain more influence, including packing appointed government positions and also seats on advisory boards, committees and commissions in order to better manipulate who is awarded lucrative government contracts. This also is a place where the revolving doors are swinging rapidly and conflicts of interest are running rampant.The taxpayers are the victims on all sides.Please let me know if you have first hand knowledge of any of this.-GFS

WASHINGTON, May 6, 2008 — In the spring of 2006, Boeing paid one of the largest fines ever imposed on a U.S. company for violating the Arms Export Control Act. From 2000 to 2003, the aerospace and defense giant had defied State Department regulations and warnings about the unauthorized export of commercial aircraft equipped with a microchip that had military applications.

Some of those planes ended up in China, a country to which export of defense items was further restricted after the 1989 Tiananmen Square massacre. Boeing, which already had been fined three times for violations of arms exports laws, paid the U.S. government $15 million to settle the case and agreed to the appointment of an outside “special compliance official.”

Despite such transgressions, Boeing didn’t forfeit its role as adviser to the State Department on the very laws and regulations the company had flouted. For 16 years, at least one Boeing representative has sat on the Defense Trade Advisory Group, created in 1992 to help State reduce “impediments to legitimate exports” while safeguarding national security. DTAG’s members include representatives of prominent weapons manufacturers and suppliers, such as Lockheed Martin and BAE Systems, as well as defense industry lobbyists, lawyers, and consultants – but no outside critics.

Balance in membership – required under the Federal Advisory Committee Act of 1972, or FACA — has never been one of DTAG’s hallmarks. Scholars and think-tank analysts have traditionally held only one or two seats on the 40-to-50-member panel, and in 2006 they were dropped altogether.

DTAG isn’t an anomaly. There are more than 900 committees, commissions, boards, councils and task forces, with some 67,000 members, attached to the executive branch. Some, such as the National Coal Council, appear to be little more than corporate lobbying wings with special access to top agency officials. “What we need is openness and transparency in these advisory committees so that we can feel that what they tell us is credible,” said Rep. Henry Waxman, a California Democrat. “I don’t think FACA, as written, has gone as far as its framers hoped in diminishing the influence of industry,” agreed David Vladeck, a professor at Georgetown University Law Center.

Congressional Action

After years of paying scant attention to FACA abuses – imbalances on committees, unwarranted secrecy, agency interference — Congress is considering amendments to the 36-year-old law. Legislation sponsored by Waxman and another Democrat, William Lacy Clay of Missouri, would, in Clay’s words, “improve balance, transparency and independence” among panels. The proposed amendments would require that committee appointments be made without regard to political affiliation and would strengthen conflict-of-interest disclosure rules for panelists. They also would clamp down on efforts to circumvent FACA and avoid public disclosure.

The bill is expected to go to the House floor for a vote this spring. At a hearing on April 2, the day it was introduced, several witnesses pleaded for congressional intervention.

“[T]he courts have opened loopholes in FACA’s coverage and federal agencies have whittled away at its open government mandates,” Sidney Shapiro, an associate dean at the Wake Forest School of Law, told the House Subcommittee on Information Policy, Census, and National Archives. “Congress should arrest these trends before we witness more stories of secret, biased, or unaccountable advisory committees influencing national energy policy, food safety standards, or environmental protection requirements.”

The advisory system’s flaws transcend any one administration. But the Bush White House has left its own imprint, sometimes skirting FACA altogether by accepting “informal” advice from business leaders and lobbyists, as it did with Vice President Dick Cheney’s energy task force in 2001, and refusing to make records public. Critics say it has also tinkered with panels—most notably, those focused on science—in an apparent attempt to make them ideological clones of the White House. Some have been eliminated altogether, as in the politically charged case of the Advisory Committee on Energy-Related Epidemiology Research.

A “Shadow Government”

By the close of the 1960s, federal agencies were being counseled by at least 1,800 committees, comprising what Sen. Lee Metcalf, a Montana Democrat, called a “headless monster.” Most of these panels were invisible to the American public, although the President’s Commission on Obscenity and Pornography, created by Congress in 1967, gained widespread notoriety when it concluded—after spending three years and a then-unthinkable $2 million—that dirty books, films, and magazines probably weren’t harmful to society. Three commissioners—among them Charles H. Keating, Jr., who would become a key figure in the massive savings-and-loan scandal of the 1980s—issued their own report, condemning the panel’s findings as a “Magna Carta for the pornographer.”

The public also was fixated on a scandal that unfolded at the Department of Health, Education, and Welfare (predecessor to the Department of Health and Human Services) in 1968 and 1969. Agency officials had denied prominent scientists seats on advisory committees, ostensibly because they had failed security checks. In fact, Science magazine uncovered “several explicit cases of professors barred from HEW panels, seemingly for political reasons.” After an internal investigation, the agency agreed to stop “blacklisting” committee nominees deemed unpalatable by political appointees.

In January 1970, Rep. John Monagan, a Connecticut Democrat, declared that it was time to examine the entire advisory process and launched a high-profile investigation. Newspaper accounts told of a burgeoning “shadow government” larded with pointless or corrupt committees. In December of that year, having surveyed agencies and the White House and taken many hours of testimony, Monagan’s Special Studies Subcommittee announced its findings: Advisory panels had become a “fifth branch of government,” useful when properly managed but dangerous when left unsupervised. Monagan likened them to satellites: “They go out into outer space but they keep circling around, and no one really knows how many there are or what direction they are going in . . .”

In November 1971, Metcalf argued passionately for a law that would bring orbiting committees back to earth. “[W]e have been repeatedly assured that the legal function of advisory groups, as bodies of non-governmental members, is purely as kibitzer,” the senator declared at a hearing. “But in practice many have become internal lobbies. . . . Do we want information to freely flow through the government and society for all to critically examine, or do we want it hoarded and concealed by advisory committees until after decisions are foisted upon the public?”

The FACA legislation passed 11 months later. It declared that committees should be established “only when they are determined to be essential” and “terminated when they are no longer carrying out the purposes for which they were established.” Advisory panels, the law stated, should be balanced. With rare exceptions—the consideration of national security matters, for instance—meetings should be open and records publicly available. And committees should not be “inappropriately influenced by the appointing authority or by any special interest.”

With these guidelines in place, the number of panels plummeted. But critics say some of the same mischief and chicanery that inspired Congress to act has resurfaced—or, more likely, never went away. And as the years passed, the law’s imperfections have become increasingly evident. One glaring omission, say watchdogs, was Congress’s failure to include any penalties for noncompliance. The agency charged with overseeing advisory committees, the General Services Administration, can only offer guidance when disputes arise; anyone seeking actual relief—the release of records, the reconstitution of a panel—must sue.

Dozens of such lawsuits have been filed by groups like Public Citizen, but, ironically, decisions in some of these cases have actually weakened FACA. In 1983, for instance, an appellate court held that subcommittees of advisory committees did not have to follow FACA if they dealt only with technical subjects and didn’t make policy recommendations; this loophole has been routinely exploited, Shapiro and other legal authorities say.

Similarly, in 1989, a judge on the D.C. Circuit Court of Appeals asserted that it would be nearly impossible to enforce a provision of the act that requires panels to be “fairly balanced in terms of the points of view represented.” In 1993, the White House was able to fend off attempts to obtain records of Hillary Clinton’s short-lived Task Force on National Health Care Reform; the documents were released only after the group was disbanded. And in 2004, the Supreme Court held that records associated with Cheney’s energy task force were protected by executive privilege and therefore did not have to be released.

Congress has done its share of damage by exempting numerous committees from FACA, usually in the name of efficiency. Such was the case in 1996, when it gave the Federal Aviation Administration the authority to create single-topic safety panels composed solely of FAA and industry officials. These panels, known as Aviation Rulemaking Committees, have largely supplanted the bigger and older Aviation Rulemaking Advisory Committee, which holds public sessions and includes representatives of passengers’ groups. The smaller panels meet privately, often at corporate offices, putting companies like Boeing and United Airlines in the position of telling the FAA how they should be regulated.

“Real Experts in Minutiae”

The Defense Trade Advisory Group has similar traits. DTAG’s industry representatives argue that the panel’s one-sided nature is due to the need for “expertise.” DTAG’s chairman, Bill Schneider, a fixture in Washington defense circles who served in the Office of Management and Budget and the State Department under President Reagan, said the members are “real experts in the minutiae” of arms exports regulations. Panelist Joel Johnson, a longtime advocate for less stringent arms export controls, put it more bluntly: “We are the guys who make the stuff and sell the stuff and we can bring technical expertise to the table that the government can’t find anywhere else.”

DTAG put out a call for new members in August 2007 and a second notice in February of this year. A State Department official declined to disclose names or affiliations of the nominees and said that applications are still being reviewed.

All sales of U.S. weapons—from firearms to missiles—that aren’t government-to-government transactions must be cleared by the State Department through a licensing process the industry regards as overly bureaucratic. DTAG members say their goal is to streamline the process—something that may benefit their businesses directly. At stake: up to $100 billion a year in arms exports.

DTAG conducts its business in a way that doesn’t invite outside scrutiny. Only two public plenary sessions are held each year; in 2006, an assistant secretary at the State Department unsuccessfully tried to close these meetings. The rest of the discussions take place in working groups, which are not subject to FACA and therefore need not be open to the public. These meetings are sometimes held at defense companies’ offices in the Washington, D.C., area. “It’s very informal . . . like, ‘What are you doing Monday afternoon?'” said Edward C. O’Connor, a DTAG member who is a retired Army general and now heads his own consulting firm. “We are just a bunch of people trying to do something good.”

DTAG has advised the State Department on issues both narrow and broad. In the mid-1990s, for example, it recommended that the U.S. government lift a ban on sales of advanced weaponry to Latin America; in 1997, after intense industry lobbying outside of DTAG, the restrictions were indeed lifted. More recently, the group has recommended ways to soften a department proposal that would compel foreign brokers who work for American defense companies to register with State—a requirement, the industry argues, that puts it at a disadvantage to foreign competitors. Department officials counter that more vetting is necessary. They cite some recent cases to illustrate their point, such as a consultant in Asia who worked for a large U.S. defense company while he was also an agent for the Chinese government, and a broker in Latin America who had multiple felonies.

“They are arcane issues but they are all very significant,” said Rachel Stohl, a senior analyst at the Center for Defense Information, a Washington research group. “When you have the administration being able to alter the export control system without any oversight from Congress or the American public, that’s when sanctions are lifted or weapons are sent to human-rights-abusing militaries.”

It’s difficult to gauge the depth of DTAG’s influence. What’s clear, though, is that members get access to regulators and policymakers in ways that nonproliferation advocates and academics don’t. “You do have an occasion to keep nagging these people over and over” said panelist Johnson, a former vice president at the Aerospace Industries Association, the main lobbying group of U.S. aviation and defense manufacturers.

For her part, Stohl fears that DTAG will pressure the State Department into changing the rules in ways that could harm Americans. “You are talking about life-and-death systems with significant consequences for international security,” she said. “We are not talking about teddy bears.”

An Act in Disrepair

There are, to be sure, plenty of civic-minded advisory bodies. Among them is the Environmental Protection Agency’s Clean Air Scientific Advisory Committee, whose members have hectored the EPA to adopt stricter air pollution standards. But Georgetown’s David Vladeck, who litigated a number of FACA cases when he was with Public Citizen, worries that the evenhanded, open system envisioned by the act has fallen into disrepair.

“It’s not as though agencies aren’t calling on outsiders for help,” Vladeck said. “They’re just doing it in a less formal, less visible, less transparent, and less accountable way.”

Congressman Waxman agrees. He was an early critic of Cheney’s energy task force and has continued to denounce the Bush administration for what he calls excessive secrecy.

A 2004 report prepared by the Democratic staff of Waxman’s House Government Reform Committee charged that the administration had “acted to weaken and avoid FACA’s requirements.” It offered several examples, among them the President’s Commission on Intelligence on Weapons of Mass Destruction – better known as the WMD Commission – indirectly exempted from FACA by provisions the president placed in the executive order creating it.

The Bush White House, Waxman said, has shown a willingness to abolish panels “they think may be too honest” or alter the composition of committees “to get the people they want. . . . I think it becomes a process not to give us the best advice . . . but to be sure the government gets the advice they want to get.”

Scientific panels, in particular, have not fared well the past seven years.

In August 2007, for example, the EPA disbanded the National Pollution Prevention and Toxics Advisory Committee, created in 2002 to give the agency a cross section of input on issues such as nanotechnology and lead poisoning. After a promising start, the committee fell dormant after three scientists – all environmental advocates – resigned in protest in October 2006.

The scientists complained that the group had been stymied by representatives of the chemical industry, who resisted efforts to reach consensus on matters of chemical policy, and that the EPA had not done enough to resolve the conflicts. “It was basically an us-against-them dynamic, which didn’t allow real progress forward,” said one of those who quit, Joel Tickner, an assistant professor at the University of Massachusetts Lowell’s School of Health & Environment. In his letter announcing the committee’s breakup, EPA Assistant Administrator James Gulliford thanked the remaining members for their service and wrote that he had decided to “utilize a range of approaches to obtain stakeholder input, formal and informal, instead of reconstituting the [committee].”

The Bush administration has been accused not only of killing troublesome panels, but also of meddling in the advisory process – something FACA was supposed to prevent. The Union of Concerned Scientists has documented dozens of examples of such interference—from the appointment of people with lead industry ties to a CDC panel on childhood lead poisoning to the application of political litmus tests for nominees to committees that advise the National Institute on Drug Abuse and the Army. Richard Jackson, a former director of the CDC’s National Center for Environmental Health, said that, “In 2001, there were [administration] people calling members of committees, asking them who they voted for and whether they supported the president’s policies, which is unprecedented.”

Were he still alive, Sen. Metcalf would likely be appalled—but not terribly surprised—by the fate of FACA. During his 1971 testimony, he warned that industry held “a favored position” in the advisory process, raising the specter of a “corporate state.” And he posed a question that remains relevant: “Do we want the government to be open to all, or do we want it closed to all but elite industrialists?”

Last week, Secretary of Defense Robert Gates unveiled a plan to hire more auditors and managers to oversee those massive Pentagon contracts. It’s part of a larger push to cut back on waste, fraud and mismanagement in the Pentagon.

That’s easier said than done, however. A good portion of the Defense Department’s so-called “acquisition” workforce are themselves contract workers. So boosting oversight will mean weaning the department off of outsourced support. In an interview with Federal Times, Shay Assad, the Pentagon’s director of acquisition policy, said Gates wants to “change the mix” inside some offices to ensure that more federal employees are minding the store.

“It wasn’t necessarily, in some organizations, that we didn’t have enough people,” he said. “We just needed to change the mix from contractors to federal civilians because we felt those [jobs] were more appropriately performed by federal civilians.”

Assad said a recent internal study identified problems with the way the Pentagon does cost estimates. That should come as little surprise to readers of DANGER ROOM: The cost estimates for complex programs like the Army’s Future Combat Systems often vary wildly, making it hard to account for reasonable cost growth and measure progress.

Another issue is whether the Pentagon can rebuild its own in-house engineering expertise. In recent years, the department has effectively handed more control to “lead systems integrators” like Boeing to manage complex projects like FCS. So does this budget, as David Axe argues, spell doom for the systems integrators? Perhaps in the long term. But as Stan Soloway, president of the Professional Services Council (a trade association that represents contractors) recently pointed out to Government Executive, finding individuals with the right expertise is easier said than done.

“Simply creating and funding a position does not necessarily mean that the position will be filled,” he said.

The son of Larrain McGee, Staff Sgt. Christopher Everett, was electrocuted and killed in Iraq in September 2005. Congresswoman Carol Shea-Porter (D-New Hampshire), believes that KBR, a government contractor, should be held responsible for his death and other injuries and deaths as the result of shoddy electrical work. (Photo: AP)

Washington – A New Hampshire congresswoman said the Pentagon has failed to justify giving a new, $35 million contract to a company whose electrical work on U.S. facilities in Iraq has been criticized as shoddy and unsafe.

At least three service members were electrocuted while showering at U.S. facilities in Iraq. Others have been injured or killed in electrical incidents.

Houston-based contractor KBR Inc., which maintains nearly all U.S. facilities in Iraq, has said it was not responsible for any of the deaths, and that safety is its top priority.

In a letter sent last month, Army Secretary Pete Geren told Rep. Carol Shea-Porter that KBR got the new contract because the Army Corps of Engineers felt KBR had performed well on other jobs. Geren also said KBR was the only contractor to submit a proposal, and was not on a government list of debarred companies.

“The office that is overseeing this work has the expertise required to monitor both the design and construction aspects of the project,” Geren said in the letter, a copy of which was shared with The Associated Press.

“What do you have to do to get on that list? Why weren’t they suspended?” Shea-Porter, a Democrat on the House Armed Services Committee, said in an interview this week. She is seeking more information on the contract decision.

“The issue here is we can’t change what’s happened,” she said, “but we certainly have an obligation to these men and women who have suffered and their families to fix them and to make sure we don’t hand another contract out to anyone or any company who had a hand in this.”

Inspections of some of the thousands of Iraq facilities that KBR maintains have turned up major electrical problems at more than a third of the sites.

The AP reported Feb. 6 that KBR was given an Army Corps of Engineers contract to build a convoy support center in southern Iraq that includes a power plant and electrical distribution center. Shortly before the contract was awarded, a senior Pentagon official had rejected the company’s explanation of electrical mistakes in Iraq and said some defense officials had lost confidence in KBR’s ability to do electrical work.

On Feb. 13, KBR was notified by the military that it had accepted KBR’s plan to fix the electrical problems, according to a copy of the letter obtained by the AP using a Freedom of Information Act request.

The military is in the process of inspecting every facility in Iraq and making repairs to electrical problems.

Interestingly enough, one of the most intense concerns voiced by those inside of the company and even more so outside, is the failure of the company to attract and retain the kind of creative minds they’ve been fortunate enough to have in the past, and who’ve always produced the cutting edge products this company has in the past prided itself on developing.It appears something has gone very wrong the past decade or so.–GFS

ST. LOUIS, June 14, 2004 — Boeing [NYSE: BA] space shuttle engineers are getting a refresher course in how to better understand and solve complex engineering problems in an effective team environment.

James F. Peters, Boeing principal scientist and engineer for the International Space Station and Space Shuttle, developed the four-hour Problem Resolution workshop to give engineers additional tools to analyze the multiple root causes of complex problems while highlighting the need for a systematic approach to problem solving and prevention.

Although most Boeing engineers have good engineering problem solving skills, the workshop takes the additional step of standardizing the approach engineers follow across all Boeing space shuttle sites when identifying the hazards associated with spaceflight, understanding the causes of failures and the factors for successful problem resolution.

Two case studies used in the course to highlight successful problem solving include the fuel cell problem on the Microgravity Science Lab Mission on STS-83 and the crack in the 17-inch ball Strut Tie Rod Assembly (BSTRA) that could have caused structural failure of the feed line to the Space Shuttle Main Engines. The lessons learned from these two case studies along with the problem solving methodology from the class are applied to exercises designed to provide engineers practical experience using the problem solving techniques.

Four common themes about successful problem resolution teams (PRTs) are taught in the workshop. “Engineers are taught that a clear definition of the problem is necessary and about the importance of getting the right people working together to solve the problem. A critical member of the PRT is the leader, who is responsible for selecting the team members, executing the problem resolution process, and ensuring all possible root causes are identified,” Peters said.

The rest of the workshop focuses on a roadmap containing a sequential series of steps teams should follow to identify the root causes using fault tree analysis. The final step is to develop an action plan, which has multiple dimensions aimed at fixing or preventing problems and can range from additional testing to hardware changes and redesign.

The workshop is open to all Boeing space shuttle engineers at NASA Systems sites in Huntington Beach, Calif., Kennedy Space Center and in Houston. In addition to space shuttle employees, ISS, United Space Alliance and NASA employees have been attending classes, which average about 20-25 engineers. Every week, about one to two classes are conducted at each site, and will run to the end of the year. “This workshop is very beneficial to Boeing engineers and our customers as the fundamentals are applicable to other programs as well,” added Peters.

“I wanted additional training for our engineers so that they could better solve technical problems in a team environment. What we do everyday in the shuttle program requires our best engineering effort, everyday. This workshop will improve the quality of support we give to our customer,” said Bo Bejmuk, manager of the Boeing Space Shuttle Orbiter Program and the champion of establishing this workshop, which is a mandatory for his engineers.

What do engineers think about the workshop? In class surveys, all of the engineers think the workshop was effective at providing a better understanding of problem resolution while the vast majority highly recommends the workshop to others.

“It was a straightforward approach to problem solving, especially for some people who have not been a part of a PRT. People often struggle initially with the mechanics of problem solving and this helps people effectively pinpoint what they need to do first and how to avoid overlooking something important,” said Robert Mills, a provisioning project engineer on the space shuttle program, who attended the workshop.

A unit of The Boeing Company, Boeing Integrated Defense Systems is one of the world’s largest space and defense businesses. Headquartered in St. Louis, Boeing Integrated Defense Systems is a $27 billion business. It provides systems solutions to its global military, government and commercial customers. It is a leading provider of intelligence, surveillance and reconnaissance; the world’s largest military aircraft manufacturer; the world’s largest satellite manufacturer and a leading provider of space-based communications; the primary systems integrator for U.S. missile defense; NASA’s largest contractor; and a global leader in launch services.

How CEOs are being held to higher ethics

NEW YORK – An executive working long hours, away from the family on business trips, develops a close relationship with a subordinate executive of the opposite sex. More than business is transacted.

These days, companies are starting to further define the boundaries for such relationships. Some businesses are asking employees to sign “love contracts” that give information about sexual harassment and let both parties admit to “consensual sex.”

On Monday, Boeing’s board of directors took another approach – forcing out the chief executive officer for an extramarital relationship with another employee.

Corporate observers believe Boeing’s move may foretell a higher standard for personal behavior in the post-Enron world. In effect, the Boeing decision says that the chief executive, while no longer the meanest businessperson on the planet, has a responsibility to set the highest ethical standards in the company.

“Every CEO knows about this today,” says Steve Scalet, an assistant professor of philosophy at Binghamton University in New York. “Will this have an effect? To some extent it has to.”

Workplace romance is an issue that has dogged companies for as long as there has been a water cooler. But in recent years, it appears these kinds of relationships are multiplying.

“The workplace is a meeting ground,” says John Challenger of Challenger, Gray & Christmas, a Chicago outplacement company. “People work longer and travel more, and there are not as many places to meet people, especially when you are sitting alone in front of a computer all day.”

Although some companies may be willing to look the other way when it comes to office dating, infidelity is a tougher issue. For many Americans, the issue of adultery joined everyday discourse when reports surfaced that President Clinton had had an affair with an intern, Monica Lewinsky.

Measuring the problem

Of course, infidelity was around well before Clinton’s problems. Some studies have found that in the 1940s, 50 percent of men and 25 percent of women confessed to extramarital linkups. A University of Chicago study done five years ago found 25 percent of married men and about 15 percent of married women had cheated.

A 2003 Oxford University study, conducted over seven years, found that offices with both men and women (in comparison with single-sex offices) increased the divorce rate by 70 percent.

Examples abound of CEO indiscretions. In the early 1980s, the nation debated the adulterous romance between William Agee, then president of Bendix Corp., and his blond 29-year-old assistant, Mary Cunningham.

Affairs have roiled the executive ranks at such companies as Ashland, Staples, Blue Cross & Blue Shield of Missouri, and General Public Utilities.

More recently, the nation read about how the former chairman of General Electric, Jack Welch, had an affair with an editor at the Harvard Business Review.

Because of these types of affairs, companies have started to enact new and tougher ethics codes. One indication: In 1988 when the Conference Board, a business research group, had its first ethics conference, it found only one attendee with the word ethics in his or her title, says Ron Berenheim, the board’s principal researcher. Today, 1,200 ethics officers in 500 to 600 companies are members of a professional ethics association.

Corporate ethicists may be on the rise, says Mr. Berenheim, because new federal sentencing guidelines say companies need an effective compliance program to affect an ethical culture: “Corporate boards are now under greater responsibility for oversight of their ethics programs.”

In fact, some companies are enacting “zero tolerance” on anything that even approaches a conflict of interest. “It does not mean the ethical policy says, ‘Thou shalt not commit adultery,’ ” says Berenheim. “But the board is saying, ‘You acted like a dummy, get out of here.’ “

Boeing’s problems

That is apparently what has happened at Chicago-based Boeing. Only 15 months ago, the company was reeling from a series of scandals. It had fired its CEO, Phil Condit, after defense contracting scandals sent two of the company’s executives to prison and the company had lost an enormous contract. To try to show that it had changed its culture, it brought in Harry Stonecipher, who enacted a zero-tolerance policy.

In recent weeks, Boeing’s chairman, Lew Platt, received an anonymous tip that Mr. Stonecipher was having an affair with a female executive. When confronted, Stonecipher did not deny the affair.

In its official statement, Boeing said, “The CEO must set the standard for unimpeachable professional and personal behavior.”

In the past, a corporate board might have announced a resignation for “personal reasons,” or so the individual could spend more time with family. But, Berenheim says, “Now the view is whatever the level may be – even CEO or chairman – we need to separate ourselves from this person fast.”

In Boeing’s case, says Mr. Challenger, it may not have had too many options left: “It may have felt, ‘We have two strikes against us, two big ethical lapses. We must take preemptive action here.’ “

However, Challenger says it may be too soon to say if more companies will follow suit. “We just don’t know if there is some heavy-duty sexual harassment going on that’s been capped by the company,” he says.

But he adds, “I think it’s interesting that in the wake of Enron and other ethics scandals, there are now ways for more anonymous whistle-blowing, which could lead to more of these things coming out.”

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